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Behind the iPhone and Apple/Cingular Deal

The Wall Street Journal delves deeper (Subscription Required) into the history of the development of the Apple iPhone and touches on a number of details that had already emerged in the weeks following the iPhone announcement.

The article reinforces the impression that Apple been able to negotiate a remarkably favorable deal in a traditionally Cell Phone Carrier-slanted market. The Wall Street Journal confirms details such as a lack of Cingular branding, limited retail availability (Cingular Stores and Apple Stores only), and even Cingular sharing monthly revenue with Apple.

The deal also calls for Cingular to share with Apple a portion of the monthly revenues from subscribers, a person familiar with the matter says.


Many of these terms and conditions were previously revealed when news came out that Verizon had passed on the iPhone. The original article's claims that Apple wanted "a percentage of the monthly cellphone fees, say over how and where iPhones could be sold and control of the relationship with iPhone customers" appears to be true.

Apple's level of secrecy surrounding this project appears to have reached all time highs as previously noted. Earlier reports claimed that several fake prototypes were circulated to confound rumors of the device. This new article confirms that very few individuals had seen the full iPhone prior to launch. Even Cingular engineers were given dummy versions with very limited access. Even now, "the handful of Cingular people who have access to the sample phones at the company's headquarters were required to sign confidentiality agreements."

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65 months ago
This will be big, no doubt. Verizon's loss, Cingular's gain....
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65 months ago
I still think Apple would have been better off being their own service provider.

This is perhaps what they'll do once they've entered the market and the Cingular deal expires.
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65 months ago

I still think Apple would have been better off being their own service provider.

This is perhaps what they'll do once they've entered the market and the Cingular deal expires.


Is that even feasible?

I thought Cingular has exclusive rights for a few years.
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65 months ago

I still think Apple would have been better off being their own service provider.

This is perhaps what they'll do once they've entered the market and the Cingular deal expires.


The article mentions this and Jobs didn't want to do it


Early on, both sides determined it would be a bad idea for Apple to offer its own cellphone service, leasing access to Cingular's network. Even though Virgin Mobile USA and other startup cellphone operators were using that method with some success, Mr. Jobs was cautious. He viewed the cellphone business as an unforgiving one, where carriers are blamed for network problems and overwhelmed by customer complaints.

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65 months ago

This will be big, no doubt. Verizon's loss, Cingular's gain....


Agreed. I wonder if Verizon had regrets about passing after the phone was revealed. But then again, Cingular might be the one with regrets if the phone isn't as much of a money maker to them as they're hoping.

Personally, I can't wait to ditch T-Mobile for a service that actually works within my house. They've got my $600...however they split it. And it would feel good to me knowing that Apple would be putting some of my monthly bill back into their pockets. That just tells me that it's more about the phone than the service.

Anyone know if Cingular lets you bring over your number from another carrier?
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65 months ago
I played around with the iPhone last night, finally able to borrow a friends. The touch screen worked really well and I was suprized how elegant it was to hold. The colors looked great.

Then I woke up. :mad:
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65 months ago
With monthly revenue sharing, no network branding and the suchlike, I think Cingular just realised how important it could be to have Apple on your side in the marketplace.

I'm glad about the lack of branding, I can't stand network logos on phones. Yuk. :o
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65 months ago

Agreed. I wonder if Verizon had regrets about passing after the phone was revealed. But then again, Cingular might be the one with regrets if the phone isn't as much of a money maker to them as they're hoping.

Personally, I can't wait to ditch T-Mobile for a service that actually works within my house. They've got my $600...however they split it. And it would feel good to me knowing that Apple would be putting some of my monthly bill back into their pockets. That just tells me that it's more about the phone than the service.

Anyone know if Cingular lets you bring over your number from another carrier?


What makes you think Cingular will be significantly better? T-Mobile and Cingular are both GSM...

Over here, T-Mobile tends to be regarded as the better of the two, but I haven't seen any kind of tests.
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65 months ago


Apple's level of secrecy surrounding this project appears to have reached all time highs as previously noted. Earlier reports claimed that several fake prototypes were circulated to confound rumors of the device. This new article confirms that very few individuals had seen the full iPhone prior to launch. Even Cingular engineers were given dummy versions with very limited access. Even now, "the handful of Cingular people who have access to the sample phones at the company's headquarters were required to sign confidentiality agreements."


This is starting to sound borderline paranoid. I knew this from previous reports but how it is phrased here just sounds ridiculous.

I have never heard of another corporation as locked down as Apple. Can someone please explain why it is necessary for Apple to have confidentiality agreements on a product Steve Jobs spent 1.5 hours talking about??? How much could there be that he hasn't told us? On top of that, what is it that he could still be hiding?

This just all seems over the top. I thought it was cool until the iPhone, Apple is just getting crazy now. Maybe if they spent less time making fake iPhones we wouldn't need to wait till June to buy them. Am I alone on this complaint?
Rating: 0 Positives / 0 Negatives
65 months ago

This is starting to sound borderline paranoid. I knew this from previous reports but how it is phrased here just sounds ridiculous.

I have never heard of another corporation as locked down as Apple. Can someone please explain why it is necessary for Apple to have confidentiality agreements on a product Steve Jobs spent 1.5 hours talking about??? How much could there be that he hasn't told us? On top of that, what is it that he could still be hiding?

This just all seems over the top. I thought it was cool until the iPhone, Apple is just getting crazy now. Maybe if they spent less time making fake iPhones we wouldn't need to wait till June to buy them. Am I alone on this complaint?



Because no other company is copied as much as Apple. It's the old saying...just because you are paranoid doesn't mean they aren't out to get you. One leak could take away Apple's competitive edge. Go worry about something else and Apple will worry about getting its products to market just fine.
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